The Long Road In Search of a Health Care Cure

May/June 2012 • Policy Report

In September 1993 President Bill Clinton stood before the nation and delivered a forceful call to arms. “This health care system of ours is badly broken,” he declared, “and it is time to fix it.” In a 53‐minute diagnosis of the system’s failings, the president unveiled his blueprint for a comprehensive reform scheme — a plan that would eventually collapse under its own weight. Looking back on the failure of Hillarycare, President Clinton complained bitterly in a 1994 interview that “well‐funded think tanks like the Cato Institute” had prevented him from accomplishing his goals.

Two decades later, Cato remains on the front lines of the battle against Obamacare — fighting for a health care system that preserves our commitment to free markets, individual liberty, and limited government.

In late March the Supreme Court devoted six hours over three days to the Patient Protection and Affordable Care Act — the longest time spent on oral arguments in over 47 years. At the conceptual center of this challenge was Randy Barnett, the Carmack Waterhouse Professor of Legal Theory at Georgetown University and a senior fellow at the Cato Institute.

Referred to by the New York Times as the “intellectual godfather” of the case against Obamacare, Barnett argues that, at its core, the challenge is not about health care. It’s about power. “The government has no answer, either in press conferences or in court, as to what the limits are on the law,” he says. At a Cato Institute conference prior to the high court proceedings, Barnett specified the four most salient reasons why Obamacare goes too far.

The first argument is that the law is unprecedented. The federal government has never required individuals to purchase a product simply for being alive. There is therefore no direct authority for that power. As senior fellow Ilya Shapiro wrote in a special Preview issue from the American Bar Association, the law has no historical parallels “in its regulatory scope [or] its expansion of federal authority over states and individuals.” In short, Obamacare is without precedent.

Second, Barnett argues that the law is uncabined — meaning it is not subject to any limits. How so? In “The Case against President Obama’s Health Care Reform: A Primer for Nonlawyers,” Cato chairman Robert A. Levy boiled down the legislation’s constitutional complexities to one simple point. “Essentially, the insurance mandate is regulatory bootstrapping of the worst sort. Congress forces someone to engage in commerce, then proclaims that the activity may be regulated,” Levy writes. “If Congress can do that, it can prescribe all manner of human conduct.”

Obamacare is also unnecessary. Congress chose not to use its taxing and spending power in order to accomplish the goals set out in the law for one simple reason. “Rather than suffering the political liability of raising taxes,” legal associate Trevor Burrus wrote in U.S. News & World Report, Congress forced individuals to cross‐subsidize each other. “It avoided the above‐the‐board taxation and clear budgeting in order to hide the true costs of the law,” Burrus continued.

Finally, the power that the federal government is trying to claim is dangerous. This reform would change “the fundamental relationship between government and the people,” senior fellow Michael Tanner wrote in the New York Post — ending our system of enumerated, and thus limited, powers. As such, it opens up the potential for political abuse in the future. “This mandate may seem innocuous now,” Barnett explained, “but the next one doesn’t have to be.”

Using these arguments as ammunition, Barnett has had a palpable impact on the debate. He “has helped drive the question of the health care law’s constitutionality from the fringes of academia into the mainstream of American legal debate and right onto the agenda of the United States Supreme Court,” according to a front page profile in the Times on the first day of oral arguments.

Cato has long maintained a principled libertarian stance on this issue. We released multiple editions of Patient Power in 1992, 1993, and 1994, an alternative to Clinton’s health plan that argued for Medical Savings Accounts. We’ve held annual state health policy summits throughout the country since 2007, highlighting the best ways to restore responsibility to individuals through state‐based initiatives. And we’ve most recently filed 10 amicus briefs challenging the constitutionality of Obamacare, opposing in particular the breathtaking assertions of power under the individual mandate.

In a recent article in Forbes, health care consultant Avik Roy highlighted the complex origins of the mandate. “Today, there is near‐unanimity on the right that the mandate is an egregious violation of individual liberty,” he wrote. “But liberal critics are right to point out that that wasn’t always true.” Roy went on to trace the “tortuous history” of conservative support for the mandate — but noted that these ideological inconsistencies were by no means absolute.

“As is often the case,” he wrote, “it was the libertarians at the Cato Institute and the Wall Street Journal who were right at the beginning, and right in the end.”